Title
Resolution to Replace the Ann Arbor Housing Commission with the Ann Arbor Housing Development Corporation as the sole member of the Limited Liability Corporations created to redevelop the Ann Arbor Housing Commission Properties under RAD as well as the owner of the non-LIHTC properties.
Memorandum
The City of Ann Arbor is currently the owner of the Ann Arbor Housing Commission properties. The City of Ann Arbor has agreed to transfer ownership to the Ann Arbor Housing Commission when the units are converted under RAD to project-based vouchers. The AAHC created a non-profit subsidiary called the Ann Arbor Housing Development Corporation (AAHDC) for the purpose of future development. In order to redevelop the properties using Low-Income Housing Tax Credits (LIHTC), the AAHC's subsidiary AAHDC forms an LLC which will become the general partner with a limited equity partner in a separate Limited Dividend Housing Association, LLC as required to establish an ownership interest in the property under the IRS Code.
The Ann Arbor Housing Commission is the administrator of the RAD project-based vouchers. Under HUD regulations, the AAHC can administer project-based vouchers on properties that it also owns and manages. However, under RAD, HUD has determined that the ownership entity and the voucher administrator must be two different organizations.
In order to make a clean division between the AAHC as the project-based voucher administrator and the properties that are being developed, it is recommended that the AAHDC become the sole member of the LLC that will be the general partner with the equity partner. For example, the AAHC is the sole member of Maple Tower Ann Arbor LLC. Maple Tower Ann Arbor LLC is the general partner of the Maple Tower Ann Arbor Limited Dividend Housing Association, LLC along with its limited partner, Redstone Equity Partners. The AAHC will be replaced by the AAHDC as the sole member of Maple Tower Ann Arbor LLC. The AAHC will also ...
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